Should the NFL continue to enjoy non-profit status?

Seattle Seahawks wide receiver Golden Tate (81) and wide receiver Doug Baldwin (89) pump their arms in celebration after a touchdown run by Baldwin during the second half of the NFL Super Bowl XLVIII
Gregory Bull, AP

At this time of year, news about the National
Football League is inescapable (just ask the Denver Broncos). But even during the rest
of the year, when Super Bowl fever has passed, few aspects of U.S. popular culture are as relentlessly ubiquitous. NFL marketing is everywhere.

As popular ventures go, few are as financially successful as the NFL. The entire league sees a reported $10 billion in annual revenue, and has a goal to reach $25 billion by 2027 -- so you might wonder why the NFL is a listed as a nonprofit organization.

According to its 2011 IRS filings, the NFL is a "trade association" that promotes
the interests of its clubs. Trade associations
typically do such things as lobby governments, help create industry standards, develop
benchmarks for companies to use in measuring their own performance, and
otherwise advance the interests of a given industry.

But the NFL goes one better by having developed a revenue
machine through creating intellectual property, licensing logos and names for
merchandising, negotiating deals for televising games, and running the schedule
of games, including producing the Super Bowl. And that machine is a printing
press for money:

Revenue for the league, not counting what the teams
made, was $255.3 million.

The top eight league officials made a total of $50.1
million in 2011 from the NFL or related organizations, with commissioner Roger
Goodell seeing about $29.5 million in his paycheck.

The league received another $10.4 million (including nearly $7.6 million to former commissioner Paul Tagliabue).

In 2011, the NFL paid $35.9
million for office construction, $13.5 million in office rent, $6.7 in IT
consulting, and $6.7 million in travel expenses.

Total travel expenses topped $11 million.

It had notes and loans owed to it of nearly $620.8
million.

For all the income, expenses were even higher at
almost $333 million.

The organization spent more than $1.5 million on
lobbying.

How does an organization that seems all about for-profit
business get the soft tax treatment? Through lots of practice, according to Gregg Easterbrook of The Atlantic. In the
1960s, professional football had its foundational wins in getting legislation passed through Congress, granting permission to act as a monopoly
in return for the promise not to run games on Friday or Saturday nights that
might conflict with high school or college football. At that point, "professional
football leagues" was added to the requisite IRS codes, allowing the group
to act as a non-profit. Easterbrook writes:

"This decision has saved the NFL uncounted
millions in tax obligations, which means that ordinary people must pay higher
taxes, public spending must decline, or the national debt must increase to make
up for the shortfall. Nonprofit status applies to the NFL’s headquarters, which
administers the league and its all-important television contracts. Individual
teams are for-profit and presumably pay income taxes—though because all except
the Green Bay Packers are privately held and do not disclose their finances,
it’s impossible to be sure."

However, individual teams get significant tax breaks and
assistance -- whether money to help construct stadiums, abatements of property
taxes, long-term low-cost loans, and even payments to keep teams where they are.
U.S. Senator Tom Coburn has introduced a bill to strip tax-exempt status from sports leagues, including the NFL. It
has only one co-sponsor -- Senator Angus King of Maine -- and was referred to
the Senate Finance Committee in September 2013, where it still sits.

Erik Sherman is a widely published writer and editor who also does select ghosting and corporate work. The views expressed in this column belong to Sherman and do not represent the views of CBS Interactive. Follow him on Twitter at @ErikSherman or on Facebook.